What is PLI for?

The Production-Linked Incentive scheme must drive learning to compete, not manufacture


Naushad Forbes
The Production-Linked Incentive (PLI) scheme has spawned fresh and welcome interest in investing in domestic manufacturing. It will cost Rs 2 trillion (around 1 per cent of gross domestic product, or GDP) over five years. The winds of current industrial policy continue to blow inward.  Since 2017, we have raised tariffs on thousands of tariff lines, covering 60 per cent of items we import.  Our simple average Customs duty of 17 per cent is now the highest of all emerging economies. PLI is meant to deepen domestic supply-chains and so, over time, promote greater competitiveness in Indian industry. Will it work?

The PLI scheme provides a subsidy, typically 4-6 per cent of sales, for firms in 13 sectors to make
Disclaimer: These are personal views of the writer. They do not necessarily reflect the opinion of www.business-standard.com or the Business Standard newspaper

First Published: Oct 20 2021 | 11:58 PM IST

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